Mitsubishi Metal, Mitsubishi Mining & Cement to Merge
TOKYO (AP) _ Two members of the Mitsubishi Group created from the break-up of Mitsubishi Mining during the U.S. occupation after World War II announced Tuesday that they will merge.
Mitsubishi Metal Corp. and Mitsubishi Mining & Cement Co., in announcing their merger, attempted to head off expected criticism that the move is a step toward re-establishment of the monopoly power held by Japan’s pre-war ″zaibatsu″ financial combines.
The Mitsubishi Group companies comprised one of the three most powerful zaibatsu before and during World War II.
Under the merger plan, nine shares of Mitsubishi Metal will equal 10 shares of Mitsubishi Mining & Cement effective Dec. 1, the companies said.
The merger will link one of Japan’s largest smelters of nonferrous metals with one of its largest producers of cement.
″Every president of the two companies over the past 40 years sought out the possibility of a merger,″ said Mitsubishi Metal President Takeshi Nagano, who will become chairman of the new company.
″When this merger is complete, we will feel that the war is finally over for our companies,″ Nagano said at a news conference jointly sponsored by the two firms.
The presidents of the two companies said the merger should not be seen as a ″monopolistic threat.″
By combining resources, the two firms will be able to grow into a comprehensive company, which is ″the best way to conduct a flexible and dynamic adjustment to various structural changes progressing worldwide,″ Nagano said.
Masaya Fujimaru, president of Mitsubishi Mining & Cement, who will be president of the new company, said the merger is not aimed at strengthening the business affiliations of the Mitsubishi Group, which is still known for its strong ties among member companies.
Nagano said the metal business is vulnerable to changes in foreign exchange rates and market prices, and the merger would help protect against such vulnerability.
In addition, the companies said the combination of research in metals and ceramics is expected to create a wide range of new materials.
The sales of the new company are expected to total the equivalent of about $5.7 billion during the first year and $6.4 billion within the first five years, the two companies said. The new company, which will have 9,000 employees, will have total assets of $5.1 billion, they said.
The companies decided on the merger in early March, right before Mitsubishi Mining & Cement closed its last coal mine in Ohyubari, marking the end of the company’s 120-year coal mining business.